State Treasurer Giannoulias announces sale of Springfield hotel

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The Lincoln Hotel in downtown Springfield is set to be auctioned on Dec. 14.

Updated at 1:40 PM CDT on Thursday, Oct 22, 2009

A hotel named after Honest Abe has been anything but a honest.

Now, after years of mismanagement by politically connected investors, the Abraham Lincoln hotel in downtown Springfield is set to be auctioned on Dec. 14.

“The hotel has always been known for the deal-making, influence-peddling and suspect accounting that went on behind its closed doors,” State Treasurer Alexi Giannoulias said at a Capitol news conference, the AP reported.

Giannoulias, who is running for Roland Burris’ senate seat next year, said the building “was built with taxpayers’ money but benefited only those with powerful political connections.”

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One of the hotel's investors, William Cellini, and his partners are suspected of diverting up to $2 million in revenue from the 316-room hotel to cover personal expenses rather than pay down its $30 million debt.

Cellini has since been indicted in the federal corruption case involving former Gov. Rod Blagojevich.

Construction on the hotel started in 1982, after the state loaned $15.5 million for the project.

Taking over the hotel after it went into foreclosure early last year, the state was able to make a $1.3 million profit, spending $375,000 on renovations.

Giannoulias would not say how much he expected the auction to bring in, but said if the state isn't satisfied with the price, it will wait for more favorable terms before selling it.